Our 2026 Network performance report analyses the key outcomes and performance trends of 25 network service providers (NSPs) that operate in electricity and gas networks across Australia, except for Western Australia. Specifically, this report looks at:
Each NSP is regulated by the AER under the National Electricity Objective (NEO) and National Gas Objective (NGO).
Our report covers their operational and financial performance as well as the performance of electricity DNSPs in specifically providing export services to customers who have consumer energy resources (CER), such as rooftop solar and batteries. This annual network performance report provides accessible information that support our role to monitor Australia's electricity and gas networks.
Australia's energy system is in the midst of a major transformation driven by the decarbonisation and decentralisation of energy services and the addition of new technologies to meet Australia's climate goal of net-zero carbon emissions by 2050.
In 2025, electricity networks and gas distribution networks played contrasting roles in this transition. Investment in electricity network capacity is needed for the growth in new solar, wind generation and battery storage, while electricity distribution networks need to facilitate the co-ordination of more CER into the electricity grid.
Conversely, while residential customers electrify their household gas appliances, there will be a decline in the gas delivered by gas distributors and the number of customers connected to their networks.
In recent gas regulatory access arrangement decisions, the AER has allowed accelerated depreciation as a way to mitigate against stranding gas assets associated with past capital investments. However, this will not resolve the broader policy question involving consumers, network businesses and governments as to who should pay for the costs of the stranding asset risk, or when, and how this could occur.
This contrast in the trajectory of electricity networks and gas distribution networks is evident in our network performance data in 2025.
Electricity networks are growing, as networks are investing more capital expenditure (capex) to support the growth in renewable energy and electrification, including the electrification of transport. Alternatively, while there are some differences between jurisdictions, gas distribution networks are declining and there has been an increase in customers disconnecting from the gas distribution networks.
This report also shows the evolution of the electricity grid into a two-way energy system. The growth in rooftop solar generation and home battery storage has increased the number of electricity distribution network customers exporting surplus generation. In 2025, this growth has led to 28% of all electricity distribution customers including residential and non-residential low-voltage customers using the network to export electricity. Further growth is expected next year from the continued installation of household batteries as part of the government's Cheaper Home Batteries Program.
In 2025, total network revenues increased compared with the previous year for both electricity networks and gas distribution networks. However, these revenues remain significantly below their respective peaks in 2015.
There was a notable increase in expenditures by electricity networks in 2025, which was primarily due to overspends by Ergon Energy, Jemena, AusNet Services (distribution) and Energex. In aggregate, this has resulted in significant overspends of the total operating expenditure (opex) and (capex) allowances of electricity distribution networks. For gas distribution networks there was an aggregate increase in capex and opex spends from the prior year, however the expenditures were below the total capex and opex allowances.
Financial performance differed across networks in 2025. In aggregate, electricity networks and gas distribution networks return on assets (RoA) increased. However, for electricity networks the returns were below their allowed rate of return. For the return on regulated equity (RoRE), lower inflation, declines in expenditure efficiency and lower outperformance from the debt allowance led to lower returns for both electricity networks and gas distribution networks. The gap between allowed and actual RoRE returns was closed, largely due to the changes in the interest rate and inflation environment flowing through.
In relation to service levels, for electricity distribution networks there was an increase in the total electricity delivered and aggregate maximum demand, which led to network utilisation continuing its upwards trajectory. For gas distribution networks there was a decrease in gas demand, due to milder temperatures, improved appliance efficiency and customers reduced consumption in response to cost-of-living pressures.
Although the frequency and duration of electricity outages increased slightly compared with the previous year, overall reliability remained high with outage levels still below earlier peaks. Gas distribution networks continued to record very low pipeline outages and had a slight improvement in "unaccounted for gas (UAFG)" loss rate, which measures the gap between gas entering the network and gas delivered to customers.
| Key finding | Electricity networks | Gas distribution networks |
|---|---|---|
| Revenue | Electricity network revenues increased by 6% to $14.5b (real terms). This resulted in a $62 increase in annual costs per customer. This was due to an increase of 6% in both distribution and transmission revenues respectively. Despite this increase, electricity network revenues remain significantly below (25%) their 2015 peak. On a revenue per customer basis, 2025 revenues were $658 lower than the 2015 peak. | Gas distribution network revenues increased by 4.0% to $1.7b (real terms), or a $10 increase on a per customer basis compared to the previous year. Despite this increase, gas distribution network revenues remain 17% below their 2015 peak. On a revenue per customer basis, 2025 revenues were $157 lower than the 2015 peak. |
| Incentive schemes | Electricity networks earned $506m in incentive revenues in 2025, an increase of 28% from the previous year. The increase in 2025 was driven by an increase of EBSS ($83m) and STPIS ($58m) rewards, which was offset by a decrease of CESS rewards ($25m). | Gas distribution networks paid $9m in relation to incentive scheme penalties in 2025. This represented less than 1% of total distribution network revenues. |
| Capex | Electricity networks capex increased by 14% to $8.6b, in real terms and they collectively overspent their capex allowance for the second consecutive year. In 2025, their collective allowance was exceeded by 3%. Similar to 2024, this overspend was primarily driven by electricity distribution networks, with Ergon Energy individually accounting for more than half of this overspend. Electricity transmission networks collectively invested $2.9b in 2025, an increase of 42% from the prior year. Most capex was on integrated system plan (ISP) projects, with over $2b invested in 2025. The capex to provide export services increased by 59% to $111m, representing 2% of the total capex investment by electricity distribution networks. | Gas distribution networks capex increased by 10% to $628m in real terms in 2025. Gas distribution networks' capex predominantly relates to the new connections made on the gas distribution networks and the replacement of cast iron pipelines with pipelines using polyethene or polyamide materials. This capex enables gas distribution networks to connect new customers and install new polyethylene or polyamide pipelines where necessary to provide a safe and reliable supply of gas to customers. |
| Opex | Opex was $5.1b for electricity networks, an increase of 10% in real terms. Overall, electricity networks overspent their opex allowance in 2025 by 13%. The opex incurred to provide export services was $32m, an increase of 66% from the previous year. This represented 0.7% of the total opex spend by electricity distribution networks. | Opex was $614m for gas distribution networks, an increase of 2%. Despite this increase, gas distribution networks collectively underspent their opex allowance by 12%, the eighth consecutive underspend since 2018. |
| Asset bases | There was a 2.8% increase in real terms in the regulated asset base (RAB) values for electricity networks in 2025. When disaggregated, electricity distribution network RABs increased by 1.9% and electricity transmission network RABs increased by 5.7%. Electricity RAB per MWh electricity delivered was $866, an increase of $12 from the prior year. | Capital asset base (CAB) values increased by 1.4% in real terms for gas distribution networks in 2025, resulting in a CAB per customer of $2,709, an increase of $8 from the prior year. The CAB per GJ delivered for gas distribution networks was $47, which was a slight increase of $2 from the prior year. Since 2011, this CAB per GJ delivered has increased by 49% or $15. |
| Energy delivered and utilisation | Electricity delivered by electricity distribution networks was 148.8 thousand GWh in 2025, an increase of 1.4% and the fourth consecutive annual increase. There was 16.3 thousand GWh of electricity exported, an increase of 17% from the prior year. This represented 11.0% of the total electricity delivered by electricity distribution networks. At the conclusion of 2025, the total capacity of the solar PV and batteries owned by export service customers was 21 thousand MVA, a 13% increase from the prior year. Distribution network utilisation continued its upwards trajectory in 2025 to 46%, the highest level since 2013. This was driven by higher maximum demand for Victorian electricity distribution networks. | There was 261 thousand TJs of gas delivered by gas distribution networks in 2025, a decrease of 3% from the prior year. There was a decrease in the gas delivered for each gas distribution network except Jemena Gas Networks, which had a 1.3% increase from the prior year. Going forward there is uncertainty in relation to the pace of decline in gas demand from the electrification of household appliances and other policy developments in the energy transition to net zero emissions. |
| Customer numbers | There was a 5.1% increase in export service customers. At the conclusion of 2025, 28% of customers were using export services provided by electricity distribution networks. There were 180,000 export service customers with a battery in 2025, representing 5.8% of export service customers. This is expected to increase exponentially in 2026, following the rebates offered to current or new export service customers for the Cheaper Home Batteries Program. | There was a 1% increase in customers connected to the gas distribution networks in 2025, and 1.5% increase in residential connections. AGN Victoria had the largest increase in residential customer base (3%), whilst Evoenergy's customer base decreased by 1.1%. The number of residential connections were equal to the prior year, whilst the disconnections increased by 5%. |
| Network reliability and export limits | The overall reliability across electricity distribution networks remained high because outage levels were still below earlier peaks, although the frequency and duration of electricity outages increased slightly compared with the previous year. The average non-zero static export limit — the fixed maximum amount of electricity a customer is allowed to export above zero — decreased slightly in 2025 to 5.3 kVA. There were around 20,000 export service customers which had flexible export limits in 2025, a 448% increase from the prior year. Over 90% of these customers were connected to SA Power Networks. | Network reliability across gas distribution networks remained high in 2025. UAFG improved slightly and outages continued at the same low levels as 2024. |
| Financial performance | Electricity networks return on assets (RoA) increased by 0.4 percentage points (p.p.), however as allowed returns also increased, their aggregate returns were 0.2 p.p. below their allowed rates of return. This is the second consecutive year that aggregate actual returns were below the allowed returns. The return on regulated equity (RoRE) decreased by 2.7 p.p. in 2025, for the second consecutive year and closed the gap between actual and allowed returns. | Gas distribution networks aggregate RoA increased by 0.6 p.p., the first increase since 2021. This resulted in aggregate RoA returns 0.7 p.p. above allowed returns. In aggregate, the RoRE decreased by 2.4 p.p. in 2025, primarily due to falling inflation. This resulted in returns which were 1.6 p.p. above the allowed returns. |
Download the full report at: Network-performance-report-2026_0
Source: AER
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